Question

If the price change causes total receipts to move in the opposite direction from the price...

If the price change causes total receipts to move in the opposite direction from the price change, demand must be _______.

Group of answer choices

A unit elastic

B inelastic

C elastic

Business   Economics   
0 0
Add a commentTranscribed image text
Next >

Homework Answers

Answer #1

The correct answer is 'Option C'.

The total revenue is measured by the total receipts. When the demand is elastic, the percentage change in quantity demanded is more than the percentage change in price. So, a fall in price leads to a more proportionate increase in quantity demand which causes an increase in the total revenue and an increase in price leads to a more proportionate fall in the quantity demanded which causes the total revenue to fall. So, the total receipts and price are inversely related to each other when the demand is elastic. Therefore, the correct answer is 'Option C'.

0 0
Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Log In

Sign Up

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
For inelastic demand curves, total revenue move is the __________ direction as the price; for elastic...
For inelastic demand curves, total revenue move is the __________ direction as the price; for elastic demand curves, total revenue moves in the __________ direction as the price. A. Opposite; same. B. Same; opposite. C. Same; same. D. Opposite; opposite.
With elastic demand a change in price causes a(n) _____________ change in total revenue. a. opposite...
With elastic demand a change in price causes a(n) _____________ change in total revenue. a. opposite b. identical c. unparallel d. parallel
Which of the following statement(s) is (are) TRUE about the “Total Revenue Test”: A. If price...
Which of the following statement(s) is (are) TRUE about the “Total Revenue Test”: A. If price and total revenue change in the opposite directions, demand is inelastic. B. If a price change leaves total revenue unchanged, demand is elastic. C. If price and total revenue change in the same direction, demand is inelastic. D. All the above statements are true.
CLASS: Elastic or Inelastic? A price change causes the quantity demanded of a good to drop...
CLASS: Elastic or Inelastic? A price change causes the quantity demanded of a good to drop by 20 percent, yet total revenue still increases by 10 percent. Is demand elastic or inelastic? How can you tell?
A price change causes the quantity demanded for a good to increase by 20 percent and...
A price change causes the quantity demanded for a good to increase by 20 percent and the total revenue of that good decreases by 15 percent. What can you say about the price elasticity of demand at this point. It's elastic It's inelastic It's unitary elastic It's perfectly elastic
How is total revenue increased when demand is elastic? If an increase in price causes an...
How is total revenue increased when demand is elastic? If an increase in price causes an increase in total revenue, demand is said to be inelastic and if an increase in price causes a decrease in total revenue, then demand is said to be elastic… There’s no way for total revenue to increase when demand is elastic, right?
A price change causes the quantity demanded of a good to increase by 2 percent, while...
A price change causes the quantity demanded of a good to increase by 2 percent, while the total revenue of that good decreased by 8 percent. Over this price range is the demand for this good elastic, inelastic or unitary elastic? Could anyone explain, please?
A price change causes the quantity demanded of a good to increase by 20 percent, while...
A price change causes the quantity demanded of a good to increase by 20 percent, while the total revenue of that good increases by 15 percent. Is the demand curve elastic or inelastic? Explain.
1. The Price Elasticity of Demand for a good is −0.78. Which of the following describes...
1. The Price Elasticity of Demand for a good is −0.78. Which of the following describes the Price Elasticity of Demand? Group of answer choices Elastic Inelastic Unit elastic Perfectly elastic 2. The Price Elasticity of Demand for a good is −1.11. Which of the following describes the Price Elasticity of Demand? Group of answer choices Elastic Inelastic Unit elastic Perfectly elastic
Fill in the blanks: When demand is inelastic, a decrease in price causes quantity demanded to...
Fill in the blanks: When demand is inelastic, a decrease in price causes quantity demanded to ________and total revenue to ________. If price rises and total revenue rises, demand must be ________. When demand is elastic, an increase in price causes quantity demanded to ________and total revenue to ________. If price rises and total revenue stays the same, demand must be ________ elastic.
ADVERTISEMENT
Need Online Homework Help?

Get Answers For Free
Most questions answered within 1 hours.

Ask a Question
ADVERTISEMENT